Indonesians protest against 50 percent fuel price rise

Indonesia's president called on thousands of demonstrators to refrain from violence, as riot police fired several rounds of tear gas at rock-throwing university students protesting a fuel price hike that takes effect Saturday.

Security forces chased down about 100 demonstrators in the center of Jakarta, hitting some with sticks, after the youths set tires ablaze, vandalized a bus and exchanged a volley of rocks with police on a busy street near their campus, the AP reports.

"Anarchy will only deter investment," said President Susilo Bambang Yudhoyono as he defended his unpopular decision to sharply raise the price of gasoline, diesel fuel and kerosene as the only way to stave off an economic crisis.

The size of the increase was to be announced later Friday, but ministers said the cost of many fuel products could climb by as much as 50 percent.

That would push up the price of everything from rice to cigarettes in the sprawling country of 220 million people, half of whom live on less than US$2 a day.

The price hikes follow Yudhoyono's decision to slash fuel subsidies that have helped protect Indonesia's poorest from spiraling global prices for years, but also threatened to blow the cash-strapped government's budget.

Last year, the government doled out US$7.4 billion for the subsidies, more than the international community has pledged on rebuilding efforts in countries hit by last year's tsunami.

"I realize that this is not a popular policy, a bitter pill that we have to swallow, but we have to do it to save the nation's budget and the future of the country," Yudhoyono said.

Thousands turned out for demonstrations that were held in at least 17 cities nationwide, but most were scattered and small, given the size of the country and its history of massive street rallies.